The Competitiveness of Agricultural Products in the aftermath of the Global Food Crisis: Turkish Case

Abstract

Food and financial crisis have been consecutively experienced in the second half of the 2000s and have significantly affected the commodity markets. Those crises led to serious fluctuations at food prices and agricultural production costs. In this study it is aimed to determine the change in comparative advantage of Turkey resulting from the food crisis in 2007-2008 and the rising food prices in 2011 given that the domestic agricultural production costs and prices are high in Turkey. In the study statistical comparisons are used as a method in the examination of international conditions of competitiveness via OECD statistics, and domestic sources are prefered examining cost structures and prices of selected products in Turkey to understand the global competitiveness situation. According to the data revealed in commodity prices, especially after 2010 domestic prices converged to world prices. Meanwhile, due to the crises, especially energy and fertilizer costs of agricultural production have risen and their weight in costs have increased. In the study cereal products, sunflower and sugar beet are expected to experience trouble in the world markets even when their production costs are considered. Whereas barley and sugar gains comparative advantage at world prices. Consequently, while improving agricultural structure in the country, reducing costs of inputs in agricultural production through relevant policies, productivity-enhancement through R&D and use of the technology in production are important policy choices for improving competitiveness considering the positive impact of rising world food prices.